News

Ofgem has launched a new consultation on proposed modifications to the licences of future Code Managers for the Retail Energy Code (REC) and Balancing and Settlement Code (BSC), marking the next phase of Energy Code Reform. The consultation proposes new licence conditions and transitional arrangements to support the transfer of governance responsibilities from existing industry panels and committees to licensed Code Managers.

For the metering sector, the most significant implication is the continued shift away from panel-led decision making towards a model where the licensed Code Manager becomes the formal decision maker for REC modifications, supported by advice from the new Stakeholder Advisory Forum (SAF). Existing governance bodies, including the Metering Expert Panel (MEP), are expected to cease their current approval roles, with governance responsibilities transferring to the Code Manager under the new framework.

While formal decision making will move away from metering-specific panels, Ofgem and RECCo have emphasised that industry expertise will remain central to change development. Metering stakeholders are expected to continue influencing modifications through Operational Metering Forums, workgroups, consultations and specialist advisory arrangements.

• Transfer of governance responsibilities from existing REC governance bodies to licensed Code Managers.
• Introduction of special licence conditions covering budgets, cost recovery, delivery planning and performance management.
• Greater accountability on Code Managers to demonstrate how stakeholder and technical expertise has informed decisions.
• Continued reliance on operational metering forums and specialist workgroups to provide metering expertise during modification development.
• Transitional arrangements designed to minimise disruption as the new governance model is implemented.

Although the consultation is primarily focused on governance and licensing, the changes could have a significant impact on how metering modifications are prioritised, assessed and progressed under the REC. Metering market participants should closely monitor the development of the new governance framework and seek opportunities to engage with the SAF, Operational Metering Forums and related consultation activities to ensure metering expertise continues to shape future code development.

Consultation closes on 1 October 2026.

RECCo has announced the appointment of Robert Hull as the Independent Chair of its new Stakeholder Advisory Forum (SAF). The Forum will bring together representatives from across the energy sector to provide advice and constructive challenge to the REC Code Manager, helping to inform Retail Energy Code (REC) modifications, strategic priorities, and implementation activities under the future governance framework.

Robert Hull brings more than 30 years of experience across the energy and utilities sector, having held senior leadership roles with Ofgem, National Grid and KPMG. His appointment reflects RECCo’s commitment to ensuring independent, balanced stakeholder engagement as the REC governance model continues to evolve.

The new Forum will provide a valuable opportunity for industry participants to contribute their expertise and market experience, helping to shape the future direction of the Retail Energy Code and wider retail energy market governance arrangements. Nominations for Code Party representatives are expected to open in September.

From 1 September 2026, RECCo has introduced a new approach to Performance Assurance, marking a significant step towards a more outcome-focused and evidence-led framework for identifying, prioritising and addressing risks across the retail energy market. The new approach is underpinned by an updated Performance Assurance Operating Plan (PAOP), Retail Risk Register (RRR) and Performance Assurance Methodology and Techniques (PAM), all of which have been approved by the Performance Assurance Board and are now in effect.

The revised framework strengthens the connection between retail market risks, consumer and market outcomes, and the assurance activities undertaken by RECCo. At its core is a new outcome-based Retail Risk Register, which prioritises the risks that matter most to consumers and the market, helping direct assurance activity towards areas where it can have the greatest impact. The accompanying Operating Plan sets out the assurance activities for 2026/27, including initiatives focused on data quality, vulnerable customer protection, energy theft, consumer consent, switching and billing performance, and the introduction of new market services. 

A key element of the transition is the development of an Outcome Measurement Framework (OMF), which will provide stronger evidence of how REC obligations influence consumer and market outcomes. Over the coming year, the framework will be refined to improve risk prioritisation, enhance decision-making and support more targeted assurance interventions. 

Supporting these changes is a new service delivery model that sees RECCo coordinating a network of specialist assurance providers, bringing together a broader range of expertise, data analysis and industry insight. This model is designed to improve flexibility, strengthen assurance capability and provide greater transparency regarding the effectiveness of assurance activities. 

Importantly, the introduction of the new framework does not alter REC Parties’ existing obligations. Instead, it changes how Performance Assurance is organised, targeted and delivered, ensuring assurance activity remains focused on achieving better outcomes for consumers and the retail energy market. 

As Elizabeth Lawlor prepares to become Chief Executive Officer of RECCo, she has outlined a clear vision focused on delivering positive outcomes, listening to stakeholders, and supporting innovation across the retail energy market. Drawing on more than 25 years of experience in code management and energy market governance, Elizabeth emphasises the importance of building on RECCo’s strong foundations while preparing for significant future market change.

A key theme of her leadership approach is collaboration. Elizabeth has committed to engaging closely with REC Parties, industry stakeholders, regulators, consumer representatives and service providers to better understand challenges, remove unnecessary complexity and ensure governance arrangements remain effective, proportionate and focused on outcomes. 

Looking ahead, RECCo’s priorities include supporting the transition to the licensed Code Manager model, advancing work on data, digitalisation and consumer consent, and strengthening cross-code collaboration. Elizabeth believes governance should enable innovation rather than hinder it, ensuring market arrangements remain flexible whilst continuing to protect consumers and maintain market integrity.nuity and evolution. RECCo intends to build on its existing successes whilst helping create a more joined-up, efficient and consumer-focused retail energy market. Under Elizabeth’s leadership, the organisation aims to deliver practical improvements that benefit both market participants and consumers as the energy sector continues to evolve. 

The Retail Energy Code Company (RECCo) has published an update outlining the significant progress made to Metering Assurance audits since the introduction of the Consolidated Metering Code of Practice (CoMCoP) in 2023. Working closely with its Metering Scheme Auditor (Wilcock Consultants Ltd), RECCo has enhanced guidance, reporting, stakeholder engagement and audit support resources to improve both compliance and the experience of audited parties. 

Key improvements include the introduction of downloadable audit templates, FAQs and example submissions, alongside strengthened reporting and management information. These changes have resulted in higher stakeholder satisfaction, improved clarity of audit requirements, and greater confidence in audit preparation. Overall satisfaction with the audit process increased from 8.7 to 9.1 out of 10, while ratings for audit preparation and advance notice reached 9.85 out of 10. 

Looking ahead, RECCo has extended the Metering Scheme Auditor contract until March 2028, providing continuity and enabling further development of the Metering Assurance regime. The organisation remains focused on delivering a robust, transparent and proportionate assurance framework that supports consumer protection, industry confidence and continuous improvement across the metering sector.

Source: Three years of improving Metering Assurance audits – and what’s next published by the Retail Energy Code Company on 20 August 2026.

Ofgem has published the findings from its July 2026 AI Regulatory Lab, providing valuable insight into how artificial intelligence can be safely and effectively used within the energy sector. The initiative brought together industry participants and AI experts to explore the regulatory, operational and governance considerations associated with AI-enabled decision-making, particularly in areas linked to investment and capital allocation within critical national infrastructure.

For AMO members, the findings reinforce that AI should be viewed as a tool to support human decision-making rather than replace it. Ofgem emphasises that accountability for decisions with financial, operational, safety or regulatory consequences must remain with individuals and organisations, regardless of the level of automation involved. 

A key message throughout the report is the importance of explainability, transparency and data quality. Organisations adopting AI are encouraged to ensure that recommendations can be understood, challenged and audited, while maintaining robust data governance processes. Ofgem warns that poor-quality data can undermine AI outcomes and may amplify existing issues rather than resolve them.

The report also highlights the need to embed AI within existing governance, assurance and risk management frameworks. Higher-risk applications should be subject to greater validation and human oversight, with strong governance focused on decision outcomes as well as model performance. Ofgem notes that successful AI adoption depends as much on organisational capability, skills and trust as it does on the technology itself. 

For the metering sector, the findings provide a useful framework for organisations considering AI applications in areas such as asset management, operational planning, field service optimisation, risk assessment, customer support and data analysis. As digitalisation and data volumes continue to grow, the report serves as a timely reminder that responsible AI deployment requires clear accountability, effective governance and a continued focus on consumer outcomes. 

Ofgem has confirmed that the lessons from the AI Reg Lab will inform its ongoing approach to AI regulation and guidance, signalling the growing importance of responsible AI adoption across the energy industry. 

AI Reg Lab: July 2026 | Ofgem

Ofgem has been appointed by the Government to administer a new Bill Discount Scheme that will provide financial benefits to households located near new electricity transmission infrastructure. The initiative forms part of the UK’s wider strategy to deliver Clean Power by 2030 and accelerate progress towards Net Zero.

Under the scheme, eligible households could receive discounts of up to £250 per year on their energy bills. The Government intends for the first payments to be made in early 2027, recognising the important role communities play in hosting infrastructure required to support the transition to a low-carbon energy system.

The announcement reflects the growing need to expand Great Britain’s electricity transmission network to connect renewable generation, improve energy security and meet increasing electricity demand. By ensuring local communities share in the benefits of national infrastructure projects, policymakers hope to support the delivery of critical investments needed for the UK’s Net Zero ambitions.

For AMO members, particularly those with an interest in Net Zero and the future energy landscape, the scheme demonstrates how Government and regulators are seeking to balance infrastructure delivery, consumer engagement and community benefit. While not directly impacting metering operations, it represents another important policy development supporting the wider decarbonisation of the energy sector.

Ofgem has announced that its Energy Redress Scheme has now distributed a record £250 million to support energy consumers, helping more than one million customers across Great Britain since the scheme was established in 2018. The funding is derived from payments made by energy companies that have breached regulatory obligations, ensuring that money recovered through enforcement activity is reinvested for consumer benefit.

To date, the scheme has funded 887 projects, delivering practical assistance including fuel vouchers, energy efficiency advice, support for vulnerable households and innovative community energy initiatives. Funding has also enabled the development of community-owned renewable energy projects, helping to address fuel poverty whilst supporting the transition to a cleaner energy system.

Since 2020, Ofgem reports that more than £500 million has been returned to consumers through a combination of compensation payments, fines and voluntary redress contributions. Recent enforcement actions contributing to the fund include payments from British Gas following prepayment meter compliance failures and National Grid Electricity Transmission in relation to asset maintenance obligations.

The announcement reinforces Ofgem’s continued focus on consumer protection, regulatory compliance and delivering positive consumer outcomes. While the Energy Redress Scheme operates primarily as a consumer support mechanism, it demonstrates the increasing importance Ofgem places on ensuring energy market participants meet their obligations and that failures result in tangible consumer benefit. For metering organisations, the initiative highlights the broader regulatory emphasis on vulnerability support, customer protection and maintaining trust in the energy system.